Quantum International Income Corp. announces Corporate Restructuring, Cost Reduction Plans, Proposed Grant of Incentive Stock Options, Proposed Shares for Debt Settlement and Proposed Financing


TORONTO, Nov. 11, 2015 /CNW/ - Quantum International Income Corp. ("Quantum" or the "Corporation") (TSXV: QIC / QIC.U) announces a corporate restructuring plan, a proposal to implement a debt settlement agreement with creditors of the Corporation in order to settle certain obligations, proposed stock options grant, and a proposed financing.

Restructuring and Costs Savings:

As part of its effort to restructure its business, the Corporation has taken steps to reduce corporate costs by over CAD $500,000 on an annual basis by introducing the following organizational changes:  


Termination of the external manager


Appointment of new Chief Executive Officer


Streamlined corporate office structure


Reduction in executive compensation


As previously announced, the Corporation has (i) elected not to proceed with internalizing the management services provided by Quantum International Asset Management Corp. and (ii) appointed Manu Sekhri as Chief Executive Officer, who has entered into an employment agreement with the Corporation. Streamlining the corporate office structure and reducing executive compensation is expected to allow the Corporation to reduce its annual corporate costs and ensure sufficient cash remains available to focus on existing operations and evaluating future strategic options.

These changes have been implemented as of November 1, 2015 and management is now set to focus on managing the performance of the promising businesses already in Quantum's portfolio in order to achieve profitability and to drive growth in shareholder value of Quantum.  

As part of the Corporation's restructuring plan, the Corporation also intends to grant incentive stock options ("Options") under its stock option plan to its directors, officers and employees. All of such Options will be exercisable for a period of five years at a price of $0.05 per Common Share.

Shares for Debt Settlement:

In addition to the corporate restructuring, and in order to preserve cash balances, the Corporation also plans to implement a shares for debt exchange with existing creditors whereby creditors will be offered common shares in the capital of the Corporation ("Common Shares") at a deemed price of CAD $0.05 in exchange for settlement of various debts.

These Common Shares that will be issued to the creditors of the Corporation will be subject to a four-month hold period and all Common Shares issued pursuant to the settlement agreement will be in accordance with applicable securities law and subject to the prior approval of the TSX Venture Exchange ("TSX-V").

Proposed Financing:

The Corporation announces that it intends to proceed with a financing of up to CAD $3,000,000 (the "Financing"). The Corporation expects that the Financing will take place through a combination of debt and equity. The Corporation expects the equity component to be priced at a deemed price of $0.05 per share in the form of a private placement. The net proceeds of the Financing will be used for general working capital purposes.

The Corporation may pay finder's fees in respect of the Financing to eligible parties (the "Finders"). The Finders may be paid a cash commission as well as finders warrants.

"We are excited about this new chapter for Quantum's business and we are looking forward to the challenges and opportunities ahead. The streamlined corporate office and the shares for debt exchange will help right-size the balance sheet and preserve cash for investment into future revenue generating activities," said Manu Sekhri, Chief Executive Officer of Quantum.

About Quantum International Income Corp.

Quantum is a healthcare company focused on delivering national integrated health solutions in the United States. The Corporation seeks to back management teams with strong operational track records and deep healthcare experience. The Corporation intends for acquired businesses or assets to fit synergistically within a strategic framework, have a proven operating history, opportunities for standalone growth and, potentially in some cases, national expansion. Potential acquisition targets will be in various related areas of the United States healthcare industry in different geographic regions to allow for diversification.

Cautionary Statement Regarding Forward-Looking Information

This release contains certain information which, as presented, constitutes "forward-looking information" within the meaning of applicable Canadian securities laws. Forward-looking information involves statements that relate to future events and often addresses expected future business and financial performance, containing words such as "expect" and "intend", statements that an action or event "may" or "will" be taken or occur, or other similar expressions and includes, but is not limited to, statements about the ability of the Corporation to restructure its business and save costs; the steps taken to reduce costs and that such steps will result in a reduction of over CAD $500,000 in costs on an annual basis; the termination of the external manager; streamlining Quantum's corporate office structure; the ability of the Corporation to reduce executive compensation and annual corporate costs; the Corporation having sufficient cash available to focus on existing operations and evaluating future strategic options; the focus of management and their ability to achieve profitability and drive growth in shareholder value; the plans of the Corporation to implement a  share for debt exchange and pursue a Financing; approval by the TSX-V of the share for debt exchange and Financing; the use of proceeds of the Financing; the impact of the restructuring on the balance sheet, including that cash will be preserved for investment into future revenue generating activities. These statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of the Corporation to control or predict, and which may cause Quantum's actual results, performance or achievements to be materially different from those expressed or implied thereby, including the factors discussed in the Corporation's annual information form dated July 23, 2015, (the "Annual Information Form") and the Corporation's final short form prospectus supplement dated July 21, 2015, which are available on SEDAR under Quantum's profile at www.sedar.com. Forward-looking information is developed based on assumptions about such risks, uncertainties and other factors set out herein, in the Annual Information and Prospectus, and as otherwise disclosed from time to time on SEDAR under Quantum's profile at www.sedar.com.

Unless otherwise specified in this press release, information contained in this press release is current as of the date of this press release. Unless otherwise specified, all dollar amounts herein refer to Canadian dollars. The Corporation undertakes no obligation to update forward-looking statements except as may be required by applicable Canadian securities laws. Readers are cautioned against attributing undue certainty to forward-looking statements.

The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Quantum International Income Corp

For further information: please contact Quantum International Income Corp: Vera Janakievski, Operations Manager, Tel. (416) 477-3411, veraj@quantumincomecorp.com


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